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July 22, 2013

4 Tools for Fund Managers, and All Advisors, to Use Social Media Effectively

At Finect, where we focus on how advisors can use social media to build their businesses, we’ve spoken to many managers, and while the John Paulsons of the world will continue to operate in a tight-knit, relationship-driven environment, others are turning to social media.

The question for fund managers is how they can use social media safely and effectively. How can you reach the right accredited investor while sharing appropriate information about investment products?

Here are four key tools that can not only help fund managers communicate the right way, but are also good reminders for all advisors in how to communicate with their own high-net-worth clients and attract prospects.

1) Use a Comprehensive Content Distribution Tool, While Staying Compliant

Several tools exist that enable anyone to distribute content to LinkedIn, Twitter and/or Facebook with a push of a button. But few offer an integrated compliance feature that provides for employee tracking, archiving and reporting to enable managers to meet regulatory requirements. Our company, Finect, is one firm that offers such a simple and compliant way to use social media to address this concern.

Content—from research to investment product information—can be “pushed out” and maintained, enabling managers to control what employees say and to whom. (For readers who want to learn more about how to create compelling content, we invite you to view this tutorial.)

2) Provide a Compelling Online Profile, and Don’t Forget the Obvious

One of the biggest mistakes that many advisors make in the social world is a failure to do simple things, such as including business information, links, and tags (or key words so your content and profile can be found in search engines). Would you patronize a financial professional’s business if you couldn’t find a link to the business website?

Set up a professional profile (for you or your firm) and be sure to populate it completely with an easily visible area (or areas) with relevant links, photos, even videos. You might even be able to upload a private placement memorandum and other product information.

3) Build Relationships With Your Key Prospects by Creating Groups

While many advisors or fund managers might look to social media merely to distribute content, the real goal is to engage: to build relationships with your key audience. Often, that audience will cluster around a common theme or strategy, such as “Retiring at 30” or “Short-only hedge funds.”

So consider creating groups: your own private or public “rooms” to engage with your prospective clients. It creates a way for them to get to know you and for you to share information in seconds, enhancing transparency. Top fund managers such as BBVA and Chilton Capital, and advisors like Charlie Massimo, founder of CJM Wealth Management, and the European Financial Planning Association are doing just that to take the idea of content to the next level.

4) Use Website Verification Signs to Ensure the Quality of Your Network

Websites that verify that registered professionals are, indeed, registered may make it easier for potential clients to find and connect with you. A “badge” or other designation can then help draw potential investors to your group, profile, or even your thought leadership. A verification sign is not only a tool to help you market, but it may also raise the quality of the social network in which you operate to accomplish your goals.

Remember, the last thing you want is to reach the wrong investor with your product. The new opportunities to market using social media mean that you can not only better reach your audience, but also educate them about you, your firm, and investment opportunities suitable for them.

These four simple tools will help you get started easily and effectively. Most importantly, a simple yet compliant social media platform with these features can also help you operate in today's regulated environment.

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